A Guide to Landlord Insurance

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A Guide to Landlord Insurance

Being a landlord can be a profitable and prosperous endeavour, but it doesn’t come without challenges. When you rent your investment out to tenants, you put yourself and your property at several risks unique to renting.

This is where landlord insurance comes in. But what exactly does landlord insurance cover, and do you need it? Let’s explain.

What is landlord insurance?

What is landlord insurance

Landlord insurance protects a landlord and their rental property or properties. A standard home insurance policy does not protect you against the potential risks landlords face, such as property damage, loss of rent or liability claims made by tenants and visitors, so landlord insurance is advised. It offers additional protection.

Landlord insurance policies can vary in cost and coverage depending on where your property is located, the type of property you own and how much coverage you choose to take out.

What does landlord insurance cover?

Depending on your needs and budget, you can take out a fairly basic landlord insurance policy or something more comprehensive. The more coverage you include, the higher your policy premiums will likely be.

Typically, landlord insurance will cover the following:

  • Buildings only
  • Buildings & contents
  • Contents only (not including your tenant’s belongings)
  • Fixtures and fittings
  • Full accidental damage
  • Loss of rent
  • Alternative accommodation
  • Property owner’s liability
  • Unoccupied property cover
  • Legal protection
  • Malicious damage caused by tenants up to a maximum of £5,000
  • Theft by tenants up to a maximum of £5,000

Different insurance providers and policies will cover different things, so always carefully review your policy and understand what is and isn’t covered before committing. You can compare landlord insurance policies online to ensure you get the coverage you need at the best price.

How much can I expect to pay for landlord insurance?

How much can I expect to pay for landlord insurance

So, the big question is, how much does landlord insurance cost? With home insurance, car insurance, phone insurance and an endless list of others, it can be difficult to accept adding another one to the roster.

But landlord insurance doesn’t have to be expensive. As previously mentioned, the cost of landlord insurance will depend on the location of your property, the type of property, the level of coverage required and your insurer. Age and condition can also play a part in determining your monthly premiums and the number of tenants you’re renting to. Your property may be in a flood-risk area with high crime rates. These factors will also have an effect.

Do I actually need landlord insurance?

Do I actually need landlord insurance

Landlord insurance isn’t a legal requirement. However, there is a reason landlord insurance exists. It is the best way to protect you from the unique challenges and eventualities of being a landlord. Without landlord insurance, you may be responsible for paying costs out of pocket if things go wrong.

Additionally, a mortgage lender may insist that you take out landlord insurance before they approve your mortgage. So although it’s not mandatory, you may find it difficult to progress as a landlord without it.

Don’t take chances as a landlord – especially regarding insurance and protecting yourself and your popular investments. When things go wrong, they can get expensive. With the cost of everything increasing, save yourself the headache.